Environmental Management Systems (EMSs) offer an approach to regulatory policy that lies somewhere between free market and traditional command and control methods. Worldwide, hundreds of thousands of private firms have adopted or are considering adopting these internally-managed systems for improving environmental performance. In the US, the Environmental Protection Agency has established a special recognition for firms that, among other things, adopt EMSs. And, already, numerous state agencies have proposed or adopted so-called green tier systems under which firms with EMSs can be exempted...